Personal financial planning


Many U.S. adults lack a basic understanding of common financial terms found in health insurance plans as they face critical decisions about their future coverage, according to an AICPA survey.

More than half of respondents (51%) polled in July could not accurately identify at least one of the following terms: premium, deductible, and copay, according to a telephone survey of 1,008 U.S. adults by Harris Interactive. These terms are commonly used in health insurance plans.

The Patient Protection and Affordable Care Act, P.L. 111-148, which was passed in 2010, requires individuals to purchase health insurance or pay a penalty beginning in 2014. Although open enrollment was scheduled to begin in October, the survey found that knowledge of the health care law and its implications is limited.

Forty-one percent of respondents said they are not at all knowledgeable about the law, and another 48% said they are somewhat knowledgeable.

“Half of Americans would fail health insurance 101,” Ernie Almonte, CPA, chair of the AICPA’s National CPA Financial Literacy Commission, said in a news release. “That’s critical insight as consumers prepare to make important decisions with implications for both their health and fiscal well-being.”

Fourteen percent of those surveyed said they do not have health insurance; half of those respondents said figuring out how to pay for health insurance is their biggest concern about the mandate. The requirement to purchase health insurance is the biggest financial concern for 11% of survey respondents.

Tips on evaluating and choosing health insurance are available at the AICPA’s financial education site at 360financialliteracy.org.

SPONSORED REPORT

Click-through nexus: Pushing the boundaries of sales tax compliance

Sales and use tax compliance has been complicated by nexus expansion. In this report, we provide an overview of this issue and include a handy state-by-state summary of click-through nexus or notification requirements.

QUIZ

News quiz: Surveys gauge attitudes toward IRS and economy

Recent news reported about perceptions of IRS service during the recent tax filing season and of the U.S. and global economy during the second quarter. See how much you know about recent news with this quiz.

CHECKLIST

Auditing risks in culture

Cultural flaws can seriously damage an organization. Here’s how internal auditors can reduce risks by embedding culture audits into existing audit programs.